MNI POLICY: BOJ Ups Lower End of Long-Term JGB Buys in June

--BOJ increases number of monthly buys in medium-term bucket

     TOKYO (MNI) - The Bank of Japan will increase the lower end of its

long-term government bond buying operations and increased the frequency of

medium-term bond buying operations in June.

     The lower end of long-term JGB buying operations was increased to JPY250

billion in June from JPY200 billion. However, the BOJ lowered the upper end of

medium-term bond buying operations to JPY450 billion in June from JPY500 billion

in May.

     The Ministry of Finance on Wednesday announced to increase the issuance of

government bonds worth JPY59.5 trillion to finance a second supplementary

budget, although the impact on JGB yields was limited as the BOJ has pledged to

buy huge government bonds without a limit to keep yield curve at low levels.

     The BOJ has said that the bank would conduct purchases in a flexible

manner, taking account of market conditions, aiming to achieve the target level

of a long-term interest rate specified by the guideline for market operations.

     Depending on conditions, purchase size per auction could be set at a fixed

amount or to an unlimited amount, the BOJ added.

     The BOJ's schedule sees it refrain from conducting JGB buying operations on

days when the Ministry of Finance holds auctions for JGBs or the BOJ board holds

policy meetings.

     --CALENDAR

     The planned JGB purchase operations in June:

     The zones (amounts to be purchased in ranges)

     --1 to 3 years (JPY200-JPY500 bln in June vs. JPY200-JPY500 bln in May)

     --3 to 5 years (JPY200-JPY450 bln in June vs. JPY200-JPY500 bln in May)

     --5 to 10 years (JPY250-JPY550 bln in June vs. JPY200-JPY550 bln in May)

     --10 to 25 years (JPY50-JPY200 bln in June vs. JPY50-JPY200 bln in May)

     --More than 25 years (zero-JPY50 bln in June vs. zero-JPY50 bln in May)

     The frequencies of operations in each zone in June plans vs May actual.

     --1 to 3 years: 6 times (6 times)

     --3 to 5 years: 6 times (5 times)

     --5 to 10 years: 5 times (5 times)

     --10 to 25 years: 2 times (2 times)

     --More than 25 years: 2 times (2 times)

     The dates of operations

     June 1: 1 to 3 years, more than 25 years.

     June 3: 3 to 5 years, 10 to 25 years.

     June 5: 1 to 3 years, 3 to 5 years, 5 to 10 years.

     June 10:  3 to 5 years and 5 to 10 years.

     June 12: 1 to 3 years, 3 to 5 years.

     June 17: 1 to 3 years, 5 to 10 years, more than 25 years.

     June 22: 1 to 3 years, 3 to 5 years, 5 to 10 years.

     June 26: 1 to 3 years, 3 to 5 years.

     June 29: 5 to 10 years, 10 to 25 years.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: MMJBJ$,M$A$$$,M$J$$$,M$$FI$,MN$FI$]